How to stretch development spending

24 Mar 2017

Governments and external financiers have always struggled with stretched budgets and how to wring more value from scarce resources. For developing countries, this challenge is getting tougher following the Donald Trump administration’s proposal to cut the United States’ foreign aid massively. In these circumstances, a powerful approach to get more out of development spending is by forging “productive connections” across countries – for instance, to boost cross-border trade and across related sectors such as education and health.

To protect against the spread of disease and environmental degradation, for example, it makes sense for countries to collaborate across borders in areas such as energy and water management as well as in transport and trade.

But it can be difficult to design and implement regional programmes, in part because the programme’s spending and benefits need to be equitably shared among participating countries. But new evidence suggests that promoting deeper regional economic cooperation is still well worth the effort.

Vinod Thomas,a former director-general of independent evaluation at the Asian Development Bank, is a visiting professor at the Lee Kuan Yew School of Public Policy, National University of Singapore. This article was first published on The Straits Times on 25th March 2017.